F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – overdue payables / debiti scaduti – (2020-2021) – fifa.com – atto non ufficiale – Decision 6 October 2020
Decision of the
Single Judge of the Players' Status Committee
Passed on 6 October 2020,
regarding a contractual dispute concerning the player Danny Marcos Perez Valdez
Geoff Thompson (England), Single Judge of the PSC
DEPORTIVO LA GUAIRA FC, Venezuela
Represented by Ms Melanie Schärer
CD LA SERENA, Chile
Represented by Mr Rodrigo Marrubia
I. FACTS OF THE CASE
1. On 30 April 2018, the Venezuelan club, Deportivo La Guaira FC (hereinafter: the Claimant) and the Chilean club, CD La Serena (hereinafter: the Respondent) executed a transfer agreement for the permanent transfer of the player Danny Marcos Pérez Valdez (hereinafter: the player).
2. Pursuant to clause 3 of the cited transfer agreement the parties agreed that the transfer fee of USD 600,000 would be payable in 3 instalments, as follows: a) USD 200,000 within 48 hours as from the signature of the transfer agreement; b) USD 200,000 on 15 December 2018; and c) USD 200,000 on 30 March 2019.
3. The Claimant received the first instalment on 14 September 2018, which is not part of the dispute.
4. On 10 July 2019, the parties concluded an agreement (hereinafter: the agreement), according to which the Respondent committed itself to pay to the Claimant the remainder of the transfer fee, i.e. USD 400,000, as follows:
- USD 62,500, on 10 July 2019;
- USD 75,000 on 31 January 2020;
- USD 62,500 on 30 April 2020;
- USD 75,000 on 31 July 2020;
- USD 75,000 on 31 October 2020; and
- USD 50,000 on 31 December 2020.
5. As per clause 4 of the agreement, the parties further agreed that, in the event that the Respondent failed to pay any of the instalments in a timely manner, the remaining instalments of the agreement would fall due. Additionally, the parties agreed to apply 5% interest p.a. on the amounts due.
6. According to the Claimant, on 24 July 2019, the Respondent only paid the amount of USD 62,420.
7. On 9 June 2020, the Claimant put the Respondent in default requesting the total amount of USD 337,500, plus 5% interest p.a. as from 1 February 2020. Having said this, the Claimant granted a 10-day deadline to remedy the default, i.e. until 19 June 2020.
8. On 24 June 2019, the Claimant lodged a claim against the Respondent in front of FIFA asking that the Respondent be ordered to pay to it overdue payables in the amount of USD 337,580, plus 5% interest p.a. as from 20 June 2020 until the date of effective payment, as per the agreement.
9. In its reply to the claim, the Respondent acknowledged the debt towards the Claimant and referred to the severe Covid-19 situation in Chile.
10. Thus, the Respondent submitted that “taking into account the entire reschedule of the payment plans concluded, in which clubs and other institutions (public and private) are participating at this time, allies before the worrying scenario presented, the Respondent would like to propose TO THE Claimant, in front of FIFA, the renegotiation of the agreement signed between the parties, so that the parties may find an amicable solution to the present case, motivated by the exceptional period we the clubs are living at this moment”.
11. In reply to the Respondent’s offer of a settlement agreement, the Claimant stated the following:
“We fully understand that Chile is facing an exceedingly difficult situation at the moment. However, the situation in Venezuela is unfortunately just as bad, if not worse.
Therefore, and since Club Deportivo La Guaira FC already agreed with CD La Serena on a new payment plan due to liquidity difficulties in July 2019, i.e. long before the outbreak of the COVID 19 pandemic, and since Club Deportivo La Guaira FC urgently needs CD La Serena to pay the amounts agreed for Danny Pérez’s transfer in April 2018 to cover its own financial obligations, Club Deportivo La Guaira FC is unfortunately not in a position to renegotiate the terms of said transfer.
As a result, and considering that Club Deportivo La Guaira FC has completely fulfilled its part of the transfer agreement, the club must demand that CD La Serena also complies with the terms agreed between the parties in accordance with the legal principle of pacta sunt servanda”.
12. Thus, the Claimant insists that FIFA passes a decision on the present case.
II. CONSIDERATIONS OF THE PLAYERS’ STATUS COMMITTEE
a. Competence and applicable legal framework
13. First of all, the Single Judge of the Players’ Status Committee (hereinafter: the Single Judge) analysed whether he was competent to deal with the matter at hand. In this respect, he took note that the present matter was submitted to FIFA on 24 June 2020. Consequently, the June 2020 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) is applicable to the matter at hand (cf. art. 21 of the Procedural Rules).
14. Subsequently, the Single Judge referred to art. 3 par. 2 and par. 3 of the Procedural Rules and confirmed that in accordance with art. 23 par. 1 and par. 4 in conjunction with art. 22 lit. f of the Regulations on the Status and Transfer of Players (edition October 2020) he is competent to deal with the present matter, which concerns a dispute between two clubs affiliated to different associations, i.e. a Venezuelan club and a Chilean club.
15. Furthermore, the Single Judge analysed which regulations should be applicable as to the substance of the matter. In this respect, he confirmed that in accordance with art. 26 par. 1 and par. 2 of the Regulations on the Status and Transfer of Players (edition October 2020), and considering that the present claim was lodged on 24 June 2020, the June 2020 edition of the Regulations on the Status and Transfer of Players (hereinafter: Regulations) is applicable to the matter at hand as to the substance.
b. Burden of proof
16. The Single Judge recalled the basic principle of burden of proof, as stipulated in art. 12 par. 3 of the Procedural Rules, according to which a party claiming a right on the basis of an alleged fact shall carry the respective burden of proof. Likewise, he stressed the wording of art. 12 par. 4 of the Procedural Rules, pursuant to which he may consider evidence not filed by the parties.
17. In this respect, the Single Judge also recalled that in accordance with art. 6 par. 3 of Annexe 3 of the Regulations, FIFA’s judicial bodies may use, within the scope of proceedings pertaining to the application of the Regulations, any documentation or evidence generated or contained in TMS.
c. Merits of the dispute
18. The competence of the Single Judge and the applicable regulations having been established, the Single Judge entered into the substance of the matter. In this respect, the Single Judge started by acknowledging all the above-mentioned facts as well as the arguments and the documentation on file. However, the Single Judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.
i. Main legal discussion and considerations
19. The Single Judge moved to the substance of the matter, and took note of the fact that the Respondent acknowledged its debt towards the Claimant and referred to the COVID-19 pandemic in order to justify the lack of payment.
20. In this context, the Single Judge noted that the Respondent did not file together with its reply any documentation pertaining to the question of the COVID-19 pandemic.
21. Having said that, the Single Judge highlighted that FIFA issued a set of guidelines, the COVID-19 Guidelines, which aim at providing appropriate guidance and recommendations to member associations and their stakeholders, to both mitigate the consequences of disruptions caused by COVID-19 and ensure that any response is harmonised in the common interest. Moreover, on 11 June 2020, FIFA has issued an additional document, referred to as FIFA COVID-19 FAQ, which provides clarifications on the most relevant questions in connection with the regulatory consequences of the COVID-19 outbreak and identifies solutions for new regulatory matters.
22. Accordingly, the Single Judge underlined that the Respondent failed to meet its burden of proof in accordance with the aforementioned art. 12 par. 3 of the Procedural Rules insofar as the FIFA COVID FAQ, in its question no. 1, establishes that the Bureau of the FIFA Council did not determine that the COVID-19 outbreak was a force majeure situation in any specific country or territory, or that any specific employment or transfer agreement was impacted by the concept of force majeure; rather, it provides that whether or not a force majeure situation (or its equivalent) exists in the country or territory is a matter of law and fact, which must be addressed on a case-by-case basis vis-à-vis the relevant laws that are applicable to any specific employment or transfer agreement.
23. Additionally, the Single Judge wished to outline that he could not uphold the argumentation of the Respondent since the relevant payment in dispute fell due before the outbreak of the COVID-19 pandemic. To this end, the Single Judge was firm to determine that clubs are required to comply with their financial obligations, especially those assumed before the pandemic as in the matter at hand.
24. On account of the aforementioned considerations, the Single Judge established that the Respondent failed to remit to the Claimant the amount of USD 75,000 in line with the agreement, therefore triggering clause 4 of the same agreement, i.e. an so-callled acceleration clause, rendering the remaining payments under the agreement immediately due together with interest of 5% p.a.
25. In addition, the Single Judge established that the Respondent had delayed a due payment for more than 30 days without a prima facie contractual basis.
26. Consequently, the Single Judge decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant overdue payables in the total amount of USD 337,580.
27. Furthermore, taking into consideration the Claimant’s claim, the Single Judge decided to award the Claimant interest at the rate of 5% p.a. on the relevant amount as of the claimed date, i.e. 20 June 2020.
28. Having established the above, the Single Judge took particular note of the fact that, on 9 June 2020, the Claimant put the Respondent in default requesting the total amount of USD 337,500, setting a time limit of 10 days in order to remedy the default.
29. Consequently, the Single Judge concluded that the Claimant had duly proceeded in accordance with art. 12bis par. 3 of the Regulations, which stipulates that the creditor (player or club) must have put the debtor club in default in writing and have granted a deadline of at least ten days for the debtor club to comply with its financial obligation(s).
30. In continuation, taking into account the consideration the applicable Regulations to the matter at hand, the Single Judge referred to art.12bis par. 2 of the Regulations which stipulates that any club found to have delayed a due payment for more than 30 days without a prima facie contractual basis may be sanctioned in accordance with art. 12bis par. 4 of the Regulations.
31. The Single Judge established that in virtue of art. 12bis par. 4 of the Regulations he has competence to impose sanctions on the Respondent. Therefore, and in the absence of the circumstance of repeated offence, the Single Judge decided to impose a warning on the Respondent in accordance with art. 12bis par. 4 lit. a) of the Regulations.
32. In this respect, the Single Judge wished to highlight that a repeated offence will be considered as an aggravating circumstance and lead to more severe penalty in accordance with art. 12bis par. 6 of the Regulations.
iii. Compliance with monetary decisions
33. Furthermore, taking into account the consideration under paragraph 26 above, the Single Judge referred to par. 1 and 2 of art. 24bis of the Regulations, which stipulate that, with its decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.
34. In this regard, the Single Judge pointed out that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban from registering any new players, either nationally or internationally, up until the due amounts are paid and for the maximum duration of three entire and consecutive registration periods.
35. Therefore, bearing in mind the above, the Single Judge decided that, in the event that the Respondent does not pay the amounts due to the Claimant within 45 days as from the moment in which the Claimant, following the notification of the present decision, communicates the relevant bank details to the Respondent, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become effective on the Respondent in accordance with art. 24bis par. 2 and 4 of the Regulations.
36. The Single Judge recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amounts, in accordance with art. 24bis par. 3 of the Regulations.
37. Lastly, the Single Judge referred to the temporary amendments outlined in art. 18 par. 2 lit. ii) of the Procedural Rules, which entered in force in 10 June 2020, according to which no procedural costs shall be levied for any claim lodged between 10 June 2020 and 31 December 2020 (both inclusive), and determined given that the claim at hand was lodged on 24 June 2020, the decision shall be rendered free of costs.
III. DECISION OF THE PLAYERS' STATUS COMMITTEE
1. The claim of the Claimant, Deportivo La Guaira FC, is accepted.
2. The Respondent, CD La Serena, has to pay to the Claimant, the following amount:
- USD 337,580 as outstanding remuneration plus 5% interest p.a. as from 20 June 2020 until the date of effective payment.
3. A warning is imposed on the Respondent.
4. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.
5. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to email@example.com, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).
6. In the event that the amount due, plus interest as established above is not paid by the Respondent within 45 days, as from the notification by the Claimant of the relevant bank details to the Respondent, the following consequences shall arise:
The Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amount is paid and for the maximum duration of three entire and consecutive registration periods. The aforementioned ban mentioned will be lifted immediately and prior to its complete serving, once the due amount is paid.
(cf. art. 24bis of the Regulations on the Status and Transfer of Players). 2.
In the event that the payable amount as per in this decision is still not paid by the end of the ban of three entire and consecutive registration periods, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee.
7. The present decision is rendered free of costs.
For the Players' Status Committee:
Emilio García Silvero
Chief Legal & Compliance Officer
NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification of this decision.
NOTE RELATED TO THE PUBLICATION:
FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 20 of the Procedural Rules).
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